Upgrade bought travel BNPL Uplift for $100M after it came asking for investment

Upgrade provides personal credit lines and consumer financial products; Uplift offers buy-now-pay-later installment plans at checkout for airlines, cruise lines and hotels.

Buying Uplift's network of 300 travel merchants adds travel as a financing vertical that would be hard to build from scratch.

$100 million in cash and stock; Uplift had raised nearly $700 million in equity and debt, including $123 million in a Series C at a reported $195 million valuation

Uplift was founded in 2014 by Brian Barth, who earlier sold travel startup SideStep to Kayak for $200 million. It focused on travel from the start, with partners such as United, Southwest and American Airlines vacation sites, Allegiant and Kayak, and sold installment plans for trips, for example a $2,000 Disneyland trip at $189 a month.

Uplift's president once claimed it was on track to drive nearly $1 billion in loans, but business sagged, which TechCrunch linked to a post-pandemic downturn in consumer BNPL, tighter oversight and rising delinquencies. Upgrade had launched its own BNPL-style product in October 2021 and had been diversifying with rewards checking, a Bitcoin rewards card and other cards.

Upgrade agreed to acquire Uplift, with Uplift's team joining Upgrade in matching functions and Barth becoming head of strategy. TechCrunch called it likely not the exit Uplift hoped for and a sign of BNPL consolidation. Upgrade aimed to provide close to $10 billion in credit by the end of 2023; its earlier 2023 IPO plan was unclear.

Laplanche said Upgrade already financed home improvement and auto purchases and this expands the strategy to travel as another vertical.

A distribution network of 300 travel merchants would be tough to build from scratch.

TechCrunch ties Uplift's weaker position to post-pandemic BNPL malaise, stricter oversight and rising delinquencies.

Upgrade said its access to low-cost capital can make travel financing more affordable.

When a struggling startup asks for money, a better-capitalized fintech may offer to buy it outright, taking the distribution network at a price far below funding raised.

As of 2023-07-27 the deal was agreed, with Uplift staff moving into corresponding Upgrade teams. TechCrunch said it was unclear whether Upgrade remained committed to a 2023 IPO. Integration results and the effect on Uplift merchants were not reported.